Sunday 15 December 2019

Businesses should continue to prepare for Brexit – Ulster Bank

Simon Barry, Ulster Bank chief economist Republic of Ireland
Simon Barry, Ulster Bank chief economist Republic of Ireland
Ellie Donnelly

Ellie Donnelly

Businesses should continue to plan for a hard-Brexit, according to Ulster Bank chief economist Simon Barry.

As the UK prepares to go to the polls in a general election on December 12, Mr Barry said Conservative party leader Boris Johnson is targeting a relationship between Britain and the European Union that is not closely aligned.

“This is really important, if the UK wants to do its own thing you are ruling out all the options for a close natural relationship,” he said.

“More political independence is what it wants, and if it achieves more, it's bad [for Ireland],” he told guests at a ‘Business Beyond Brexit’ event organised by the British Ireland Chamber of Commerce.

He added that the European Union and the UK are potentially heading in the direction of a “bare bones” free trade agreement.

“It would be wrong to presume we can take our foot off the gas in terns of preparation work,” he said.

Elsewhere, global uncertainty and Brexit has potentially played a useful role in stemming the risk of the Irish economy from overheating, Mr Barry said.

He added that the “really unhelpful conduct of economic policy by United States administration” meant that international markets had become more uncertain.

Uncertainty, he said, “was the enemy of growth.”

“There was now less fate in operation of global trading system,” Mr Barry added.

Turning to the domestic economy, and we have almost become desensitised to “an impressive and remarkable transformation” of the labour market here over the past seven years, Mr Barry said.

“It's not just a Dublin story, all regions have benefitted,” he said, adding that the labour market has driving influence on other aspects of the economy.

“Workers are getting paid more and household spending power is rising at about 6.5pc per year,” he said.

However, he warned against setting expectations for the jobs market to remain as strong as it currently is.

“There will be slower but more sustainable jobs growth [in the future],” he said.

Online Editors

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